The Forbes family has poked itself in the eye with its "capitalist tool."

(snip) But according to nonpublic documents made available to Fortune, the company has been under more financial strain than previously believed. Forbes Media violated covenants on a revolving credit line that it took out in 2006, according to a letter sent to the company by J.P. Morgan. The loan, which was part of a series of transactions that allowed the Forbes family to cash out more than $100 million from the company, is due next July. Some lenders have been selling pieces of it at a discount from face value.

Forbes is one of the better financial publications out there, and Steve Forbes has achieved fame as its head, even contemplating a presidential run at one point. But, the Forbes empire isn't as profitable as it was when Malcolm built and run it. The family has been selling off one trophy property after another, putting the empire under considerable strain.

I thought this was interesting, because the US is, or was, a place where there's social mobility, both upward and downward. As they say, "shirtsleeves to shirtsleeves in three generations." This might not happen to the Forbes, but the ebbs and flows of the rich are interesting in these times when our Dear Leader acts as if being rich is a permanent state that can be milked regularly for redistribution.

The family did well..they took out $250 mill when they sold a piece to Elevation Partners..They also got lots of cash..when they sold off all of ole Malcolm's toys...and maybe they sold at the top of the market...they kept the internet business..and they borrowed..that's called using OTHER PEOPLE's MONEY..rtaher than their own...the family is doing fine....they'll ride out the downturn

I missed the inter-publication rivalry angle, LOL. Clearly the Forbes empire was huge, and some of it has been cashed out and redistributed. As you point out, the article is incomplete about whether it's been dissipated as well as redistributed. Since the Forbes fortune was built around publishing, it's a short step for the reader to confuse diversification with dissipation.

Forbes has taken a hit, as have all magazines. I still subscribe..today each issue is paper thin..15 years ago..300 page issues were common with 200 pages of advertising..those days are gone....and soon will be Time

5
posted on 07/28/2011 8:55:04 AM PDT
by ken5050
(Save the earth..it's the ONLY planet with CHOCOLATE!!!)

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